BEIJING (Reuters) - Chinese authorities investigating what could be Beijing's first major suicide attack searched on Tuesday for two men from Muslim-dominated Xinjiang after three people suspected to be from the restive region drove an SUV into a crowd at Tiananmen Square and set it on fire.

They killed themselves and two tourists on Monday in the square, the heart of China's power structure and the focal point of the mass 1989 pro-democracy demonstrations brutally crushed the military.

Police have spread a dragnet across the capital, checking hotels and vehicles, seeking two people suspected to be ethnic Uighurs, a Muslim minority from Xinjiang in China's far west, on the borders of former Soviet Central Asia.

Two senior sources said on Tuesday the crash, which also injured 38 bystanders at perhaps the most closely guarded location in China, was suspected of being a suicide attack carried out by people from Xinjiang. It was initially believed to be an accident.

The sources did not specifically say the occupants were Uighurs, many of whom chafe at Chinese controls on their culture and religion.

"It looks like a pre-meditated suicide attack," said a source with direct knowledge of the matter, speaking on condition of anonymity to avoid repercussions for talking to the foreign media.

There have been suicide bombings before in China, and in Beijing, mostly by people with personal grievances, but none have targeted the very heart of China's government like this appears to have.

China has blamed Uighur separatists and religious extremists for a series of attacks in Xinjiang, saying they want to establish an independent state called East Turkestan. Rights groups and exiles say China massively overstates the threat.

In 2009, nearly 200 people were killed in clashes between Uighurs and ethnic Chinese in Urumqi, the capital of Xinjiang. But the unrest has never before spilled over into China's capital despite speculation in 1997 that Uighurs were to blame for a Beijing bus bomb that killed at least two people.

Uighurs are also not known to have previously carried out suicide attacks.

Exiled Uighur leader Rebiya Kadeer, who is based in Washington, said in a statement that she was worried that Monday's crash would bring a fierce crackdown on her people.

Kadeer, who left China in 2005, heads an international Uighur exile organization called the World Uighur Congress, based in Germany. Her group urged calm and voiced concern that Chinese censorship would stop facts from coming out.

"The Chinese government will not hesitate to concoct a version of the incident in Beijing so as to further impose repressive measures on the Uighur people," she said.

Kadeer said China has used the international fight against terrorism launched after the September 11, 2001, attacks on the United States as a pretext for a crackdown on the Uighurs in Xinjiang.

"There is no sign we will see anything different this time, even though evidence of what really happened yesterday is thin on the ground," she said in the statement from Washington.

'NO ACCIDENT'

China's government has given no official word on whether the incident was an accident or an attack. State media has mostly kept to reporting brief statements from the police and official Xinhua news agency giving a bare bones account of what happened, as is common for such sensitive events.

Police are still investigating and have yet to determine the identities of the three people in the sport utility vehicle but suspect they are from Xinjiang, according to the sources. The other dead were a Chinese man and a woman from the Philippines, both tourists.

However, Beijing police said late on Monday they were looking for two suspects from Xinjiang in connection with a "major incident" - though it was unclear if these were the people in the vehicle or accomplices still at large.

The sources said that the occupants were suspected of lighting a flammable substance in the vehicle.

"It was no accident. The jeep knocked down barricades and rammed into pedestrians. The three men had no plans to flee from the scene," said a source who has ties to the leadership.

A Reuters reporter at the scene at the time said he did not hear any gunshots.

On Monday night, hours after the fire, Beijing police issued a notice asking local hotels about suspicious guests who had checked in since October 1 and named two suspects it said were from Xinjiang. Four hotels told Reuters they had received the notice.

Judging by their names, the suspects appeared to be ethnic Uighurs.

"To prevent the suspected persons and vehicles from committing further crimes ... please notify law enforcement of any discovery of clues regarding these suspects and the vehicles," said the notice, which was widely circulated on Chinese microblogs.

Beijing police, contacted by telephone, declined to comment. On Monday, the police said on their official microblog only that they were investigating the accident, and did not say if they thought it was an attack.

Calls to the Xinjiang government went unanswered.

Barry Sautman, a political scientist at the Hong Kong University of Science and Technology who has studied Xinjiang, said if it were confirmed as a suicide attack by Uighurs, it would be a first.

"Certainly there have been a lot of bombings carried out by Uighur groups, but none of them as far as I know have involved suicide," he said.

Ilham Tohti, a China-based ethnic Uighur economist and longtime critic of Chinese policy in Xinjiang, said Uighurs had been driven to take extreme measures by China's repression.

"The use of violent means happens because all other outlets for expression are gone. Uighurs do not have any representation, they have no means of self-expression," he told Reuters.

China denies mistreating any of its minority groups, saying they are guaranteed wide-ranging religious and cultural freedoms. Many rights groups say China has overplayed the threat posed to justify its tough controls in energy-rich Xinjiang, which lies strategically on the borders of Central Asia, India and Pakistan.

IN FRONT OF MAO'S PORTRAIT

Police said on Monday the sport utility vehicle veered off the road at the north of the square, crossed the barriers and caught fire almost directly in front of the main entrance of the Forbidden City, in front of a huge portrait of the founder of Communist China, Mao Zedong.

Pictures seen by Reuters showed that the vehicle appeared to have driven several hundred metres (yards) along the pedestrian pavement in front of the Forbidden City entrance before bursting into flames, knocking down people as it went.

One eyewitness, who asked not to be identified due to the incident's sensitive nature, said she saw the vehicle knock down three or four people, and that it had a white banner with black lettering on it streaming from the back.

"People started to panic, and all ran to hide in the toilet," she said. "Three or four minutes later I came out and could see black smoke, and the police had begun to clear people out."

While censors moved quickly to remove pictures of the incident from the popular Twitter-like service Sina Weibo, as often happens in stability-obsessed China, many images and accounts are still viewable a day after the event.

Beijing police stepped up checks on cars around the city in response to the incident, one police officer at a checkpoint on the border between Beijing and Hebei province told Reuters.

A state newspaper reported in July that the government suspected Syrian opposition forces were training extremists from Xinjiang to carry out attacks in China.

"They have been known to carry out attacks outside of Xinjiang," said Yang Shu, a terrorism expert at China's Lanzhou University.

"There have also been reports that East Turkestan elements have received training in Syria, so I would say the possibility does exist of a Xinjiang connection," he added.

TOKYO (Reuters) - A Japanese ruling-party panel will recommend the break-up of Tokyo Electric Power Co (Tepco) after shortcomings in the firm's handling of clean-up operations at the crippled Fukushima nuclear plant, Japanese media said on Wednesday.

The Liberal Democratic Party (LDP) panel is proposing that Tepco's divisions in charge of decommissioning four damaged reactors and treating contaminated water at the plant should be spun off, the Nikkei and Yomiuri newspapers reported.

Tepco has floundered for more than two and a half years in attempting to clear up the site of the worst nuclear disaster since Chernobyl in 1986.

An earthquake and tsunami knocked out power and cooling at the plant in March 2011, leading to three reactor meltdowns and explosions that sent a huge plume of radiation into the air and sea, forcing 160,000 people to evacuate nearly townships.

Tepco has lost $27 billion since the disaster at the plant north of Tokyo and faces massive liabilities as it decommissions the facility, compensates evacuees and pays for decontamination of an area nearly the size of Connecticut.

Proposals endorsed by senior LDP members this week include complete financial separation of the Fukushima operations from the utility, or transforming them into an independent administrative agency, the Nikkei and Yomiuri said.

Prime Minister Shinzo Abe has promised that the government will take primary responsibility for containing contaminated water at Fukushima, saying the situation is under control.

The clean-up process is expected to take at least 30 years and cost more than $100 billion.

After months of denials, Tepco confirmed in July that contaminated water from the coastal plant was flowing into the Pacific Ocean. It has also found that 300 tonnes of highly radioactive water leaked from one of hundreds of quickly built storage tanks and reported numerous other problems.

The government effectively nationalised Tepco last year with a taxpayer-funded rescue. But there has been heated debate over direct government involvement in the company and over whether to spin off the Fukushima clean-up and let the remainder of Tepco focus on generating electricity for the Tokyo area.

Tepco has said that it is not in a position to comment on its future structure. It is revising a business turnaround plan after falling behind on its financial targets. The company reports financial first-half earnings on Thursday.

CAIRO (Reuters) - Egyptian authorities have detained senior Muslim Brotherhood leader Essam El-Erian, the latest arrest in a government crackdown against the Islamist movement, an Interior Ministry source said on Wednesday.

Erian, the deputy leader of the Brotherhood's Freedom and Justice party, was taken into custody from a residence in New Cairo where he had been in hiding.

"Yes, he's been arrested and details will soon be released," the source told Reuters.

The state news agency MENA said Erian was arrested in New Cairo but gave no further details.

Local media circulated a photo of what they described as the moment he was arrested, showing a smiling Erian standing next to a bed with two packed duffle bags.

The Muslim Brotherhood Group was banned and many of its leaders have been detained and charged with inciting violence since the army, prompted by mass protests, deposed Islamist president Mohamed Mursi on July 3.

At least 1,000 people, including security forces, died in the violence that followed Mursi's ouster. Hundreds of his supporters were killed when police forces stormed two protest camps, calling for Mursi's reinstatement, on August 14.

An Egyptian court in September banned the Muslim Brotherhood group and seized their funds in a bid to crush the movement, which the government accuses of inciting violence and terrorism.

(Reporting by Asma Alsharif and Omar Fahmy; Editing by Sandra Maler)

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